Article by Amy Anderson: VP of Analytics & Intelligence, Bounteous+Hathway
Access to first-party data has grown significantly for restaurants in the past few years.
Driven by a shift to digital ordering that has been amplified by the pandemic, restaurants are gathering first-party data from customers through apps, websites, and loyalty programs; many brands now have enough customer data to run robust CRM programs which are most successful when custom segmentation and targeting models are developed and leveraged.
Customer Data: A Different Kind of Data
When it comes to data, restaurant brands have traditionally focused on financial data to make decisions. Transactions, sales, and average order value (which are lagging indicators) are typically the top three. While this data is foundational to decision making, it does not provide insights on consumer behavior.
The introduction of online ordering apps, websites, CRM, and loyalty programs has brought a wealth of new customer behavioral data in house. This data is rich with information on how customers engage with the brand. However, many brands do not yet have the support staff or infrastructure to analyze the data to extract actionable insights.
Introducing the Analytics and Insight Maturity Model
At Bounteous+Hathway, we utilize a five-level analytics and insights maturity model with our clients to help them understand what is possible given the technology, data, and marketing activities they are able to leverage. These five levels summarize what is possible at each level and helps to lay out the types of analytic projects needed to help migrate clients from one-to-many marketing to targeted, personalized messaging.
The analysis and reporting progresses as data becomes available with technology that is implemented and marketing/loyalty that is executed. From there, analysis and reporting are aligned to glean insights, develop, and leverage targeting models and create the automated dashboards needed to mature.
Brands typically start with simple ad hoc reporting and analysis to answer one-off questions. At this stage, data is often siloed and in flat files, limiting the ability to draw deeper insights. From there, brands start to have a single platform implemented with some automation. At this level, you’ll have the ability to create and target macro segments based on distinguishing customer characteristics identified via descriptive analyses.
Another marker of advancement through the model is when rules-based targeting grounded in analyzing customer behaviors is in place, along with automated dashboards that are synchronized with data updated via batch processes.
Innovative solutions really start to cement when you have multiple models predicting outcomes. Custom models (e.g., behavioral segmentation, attitudinal segmentation, engagement scores, attrition models, etc.,) are scored on platforms and leveraged to target marketing, allowing for micro segments.
The highest level of Analytics and Insight maturity (the point when your brand is “in The Matrix”) is machine learning. Brands that have developed data operations to this degree have a fully integrated omni-channel engagement with data fully centralized and updated real-time. They also have the creative assets and marketing/loyalty at the highest maturity level needed to execute on the outputs.
Using the Maturity Model
The model migrates from ad hoc analyses that answer questions as they arise to predictive analytics that leverage statistics to uncover diagnostic insights. Through this process, a restaurant brand can produce models that will be used to predict future outcomes.
Armed with this information, how should you go about utilizing this maturity model if you’ve been tasked with operationalizing data at your organization? First, this model will help you identify where your brand stands currently on the path to utilizing customer data. Once you have that information, you can begin to create an action plan for taking the next right step.
By delving into the data available, we can see a clearer picture of what resonates with diners and create better dining options because of it.
Amy Anderson is VP of Analytics & Intelligence at Bounteous+Hathway, a digital growth partner for the restaurant industry. Bounteous acquired Hathway in 2021.